Business event: Future of My Business

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Benefits: many high street brands have only recently begun to offer online shopping

12 August 2015 • 10:30am

It is not enough for businesses to simply be aware of digital advances – they must interpret what these could mean for them and how they might benefit, writes Narry Singh, managing director, digital strategy, Accenture.

Senior executives of large incumbent organisations have many legitimate concerns and questions about the opportunity that digital presents.

Whether due to unclear monetisation models, baffling market valuations, inflexible IT systems or never-ending jargon and predictions, digital can certainly seem disruptive, and not always in a positive sense.

Despite a sea of uncertainty, it is becoming evident that organisations that successfully leverage digital technologies for new growth operate with a different set of rules and capabilities, and see a greater return also.

According to new Accenture Strategy research, creating these new digital capabilities within the next 12 months ranks as a top priority for executives globally.

This report offers pragmatic advice on how incumbent organisations can identify, develop and excel with digital, and suggests seven critical “no-regret” capabilities to be digital now.

As the term implies, these capabilities can help organisations develop and improve today, irrespective of their digital strategy or industry, and realise long-lasting benefits.

1. Sense and interpret disruption

Merely sensing change is not enough. The trick is to interpret what these changes mean to the business and, more importantly, when they will have an impact.

If business leaders are unable to interpret these change signals, they are no better placed than those who did not see change coming. Research shows that half of business leaders expect competitors to change at least some part of their business model.

The key question is: What will these new business models be, and when will they become relevant?

2. Experiment to develop and launch new ideas more quickly

Ask most entrepreneurs about how they innovate and they may look nonplussed. Most digital disrupters do not see themselves as “innovating”, per se.

In their minds, they are solving specific customer problems the best way they know how. As such, innovation is a consequence, not a goal.

Solving customer problems requires two actions: experimenting more and learning to self-disrupt. Digital technologies enable a new way of experimenting at almost an unlimited scale.

3. Fully understand and leverage data

Businesses hold almost unimaginable amounts of data, and are grappling with how to use it to develop new products and services that bring new value to their customers.

Mastering the art of exploiting data, not only by turning it into useful information, but also by finding new ways to monetise it, will be fundamental to how businesses run in the future.

4. Build and maintain a high digital quotient team

While IQ and EQ measure intellectual and emotional intelligence respectively, the time is ripe for "DQ" ‒ a measure of the digital quotient (or digital savviness) of organisations. As companies evolve their digital capabilities, they need to measure and rapidly build their teams’ DQ ‒ not least among their senior members.

Some organisations are pursuing a strategy of “acqu-hiring” ‒ buying the right skills through acquisitions of technology start-ups, or by establishing formal relationships with the start-up community.

5. Partner and invest for all non-core activities

One of the characteristics of effective digital leaders is their intuitive understanding that the journey is not one to be undertaken alone.78 per cent of research respondents indicated that they will be increasing their partnerships and alliances as they attempt to boost digital growth in the next three years.

Whether looking for new application programming interfaces (APIs), corporate development or business development partners, aligning with an ecosystem of partners is critical to digital progress.

The more they invest in others, the more organisations extend the team that is as vested in their success as they are.

6. Organise for speed

Two elements are essential for businesses to be organised for speed: according to “digital leader” aspirants, the first is CEO-level support and the presence of a dedicated central team to drive new digital growth.

The second is a team of “fixers” ‒ those at the centre of operations who are independent, respected and can draw on the right skills at the right time.

Many organisations are establishing the role of chief digital officer (CDO) ‒ a sound choice when that person also has the power to drive change and has responsibilities that are distinct from the chief information officer (CIO) and chief marketing officer (CMO).

New structures are emerging to help organisations respond more quickly to digital change. Banks have partnered with accelerators that help bring new ideas, while many retailers have set up venture funds to access disrupters.

Other companies have acquired digital teams to enhance their internal capabilities, often funding entrepreneurs who know little about their industry to create a start-up that could seriously hurt the business.

This counterintuitive process can reveal some implicit industry assumptions that are holding back the business.

7. Design a delightful customer experience

Customers’ primary motivation for repeat business is the quality of their experience. Digital technologies have reset expectations here.

Today, a banking customer using a mobile banking app does not compare it with apps from other banks, but against their best mobile user experiences for usability or functionality, whatever the industry.

It’s important that organisations put the customer at the heart of their business and stand in their shoes when designing beautiful customer experiences.